Willis Towers Watson Public Stock

Willis Towers Watson Public Limited Company (WTW) operates as an advisory, broking and solutions company worldwide. The company provides data-driven, insight-led solutions in the areas of people, risk and capital. Utilizing the global view and local expertise of its more than 46,000 colleagues serving more than 140 countries and markets, it helps organizations sharpen strategies, enhance resilience, motivate workforces and maximize performance. The company designs and delivers solutions that manage risk, optimize benefits, cultivate talent and expand the power of capital to protect and strengthen institutions and individuals.

Utilizing the global view and local expertise of the company's 48,000 colleagues serving more than 140 countries and markets, it helps organizations sharpen strategies, enhance resilience, motivate workforces and maximize performance. The company designs and delivers solutions that manage risk, optimize benefits, cultivate talent and expand the power of capital to protect and strengthen institutions and individuals.

The company's clients operate on a global and local scale in a multitude of businesses and industries throughout the world and generally range in size from large, major multinational corporations to middle-market domestic and international companies. The company's clients include many of the world's leading corporations, including approximately 95% of the FTSE 100, 89% of the Fortune 1000, and 91% of the Fortune Global 500 companies. The company also advises the majority of the world's leading insurance companies. The company works with major corporations, emerging growth companies, governmental agencies and not-for-profit institutions in a wide variety of industries, with many of its client relationships spanning decades. The company e places insurance with more than 2,500 insurance carriers.

WTW offers its clients a broad range of services and solutions to help them to identify and control their risks, and to enhance business performance by improving their ability to attract, retain and engage a talented workforce. The company's risk control services range from strategic risk consulting (including providing actuarial analysis) to a variety of due diligence services, to the provision of practical on-site risk control services (such as health and safety or property loss control consulting), as well as analytical and advisory services (such as hazard modeling and climate risk quantification). The company assists clients in planning how to manage incidents or crises when they occur. These services include contingency planning, security audits and product tampering plans. The company helps its clients enhance their business performance by delivering consulting services, technology and solutions that help them anticipate, identify and capitalize on emerging opportunities in human capital management, as well as offer investment advice to help them develop disciplined and efficient strategies to meet their investment goals.

As an insurance broker, the company acts as an intermediary between its clients and insurance carriers by advising its clients on their risk management requirements, helping them to determine the best means of managing risk and negotiating and placing insurance with insurance carriers through its global distribution network.

The company operates a private Medicare marketplace in the U.S. through which, along with its active employee marketplace, it helps its clients move to a more sustainable economic model by capping and controlling the costs associated with healthcare benefits. The company also provides direct-to-consumer sales of Medicare coverage.

The company derives the majority of its revenue from either commissions or fees for brokerage or consulting services. The company has some businesses, such as its health and benefits and administration businesses, which can be counter cyclical during the early period of a significant economic change.

Business Strategy

The company operates in attractive markets - both growing and mature - with a diversified platform across industries, segments and businesses globally. The key elements of the company's strategy are to grow at or above market in priority areas; simplify the business to increase agility and effectiveness; and transform operations to drive savings while enhancing its client and colleague experiences.

Principal Services

The company operates through two segments: Health, Wealth & Career and Risk & Broking.

Health, Wealth & Career

The Health, Wealth & Career ('HWC') segment provides an array of advice, broking, solutions and technology for employee benefit plans, institutional investors, compensation and career programs, and the employee experience overall. The company's portfolio of services support the interrelated challenges that the management teams of its clients face across human resources ('HR') and finance.

HWC is the larger of the two segments of the company. Addressing four key areas, Health, Wealth, Career and Benefits Delivery & Outsourcing, the segment focuses on addressing the company's clients' people and risk needs to help them succeed in a global marketplace.

Health

The Health & Benefits ('H&B') business provides strategy and design consulting, plan management service and support, broking and administration across the full spectrum of health, wellbeing and other group benefit programs, including medical, dental, disability, life, voluntary benefits and other coverage. The company's reach extends from small/mid-market clients to large-market and multinational clients, across the full geographic footprint of the company, and to most industries. The company can address its clients' needs in more than 140 countries.

The company's consultants help clients make strategic decisions on topics, such as optimizing program spend; evaluating emerging vendors, point solutions and coverage options (including publicly-subsidized health insurance exchanges and private exchanges in the U.S.); and dealing with above-inflation-rate increases in healthcare costs. The company also assists clients in selecting the appropriate insurance carriers to cover benefit risks and administer the programs. In addition to its consulting and broking services, the company manages a number of collective purchasing initiatives, such as pharmacy and stop-loss, that allow employers to realize greater value from third-party service providers than they can achieve on their own.

With Global Benefits Management, the company's suite of global services supporting medical, dental and risk (e.g., life, disability) programs, it has a tailored offering for multinationals. This offering includes a flexible set of ready-made solutions, proven technology and an integrated approach to service delivery that translates to a globally consistent, high-quality experience for its clients.

A meaningful portion of revenue in this business is from recurring work, though contracts may be annual or multi-year. Given the balance of revenue across consulting, broking and solutions, the company's revenue is somewhat weighted to the first half of the year.

Wealth

The company's wealth-related businesses include Retirement and Investments.

Retirement - The company's Retirement business provides actuarial support, plan design, and administrative services for all forms of pension and retirement savings plans. The company's colleagues help its clients assess the costs and risks of retirement plans on cash flow, earnings and the balance sheet, the effects of changing workforce demographics on their retirement plans, and retiree benefit adequacy and security. The company offers clients a full range of integrated retirement consulting services and solutions to meet the needs of all types of employers. The company helps multinationals coordinate plan design and actuarial services across their complex global plans. The company brings in-depth data analysis and perspective to their decision-making process as it has tracked the retirement designs and financing strategies of companies around the world over many decades.

For clients that want to outsource some or all of their pension plan management, the company offers broking services, as well as integrated solutions that can combine investment discretionary management, pension administration, core actuarial services, and communication and change management assistance.

Retirement relationships are generally long-term in nature, and client retention rates for this business are high. A significant portion of the revenue in this business is from recurring work, with multi-year contracts that are driven by the heavily regulated nature of pension plans and the company's clients' annual needs for these services.

Investments - The company's Investments business provides advice and discretionary investment management solutions to defined benefit and defined contribution pension plans, as well as to a range of other client types, including insurers, endowments and foundations, and private wealth investors. The company provides a solution to a significant business problem faced by its clients, namely sustaining the resources and skills required to deliver a financial services product in highly competitive capital markets. The company offers a flexible approach that adapts to a wide range of client needs and circumstances, with the objective of higher returns, lower risk and lower costs within each client's unique situation.

The company's solutions range from single asset class activity, through complete management of entire pension plan assets including sophisticated liability hedging programs.

The company brings together a broad array of specialist investment knowledge and skills across all asset classes, a high-quality execution platform, a cost advantage through its scale, and expert advisors with experience across all client types from the largest plans in the world to small corporate pension plans.

The company has long-term relationships with its Investments clients, with the majority of its revenue driven by retainer contracts.

Career

The company's career-related offerings include advice, data, software and products to address clients' total rewards and talent issues across the globe delivered through its Work & Rewards and Employee Experience businesses.

Work & Rewards - Within its Work & Rewards business, the company helps clients determine the best ways to get work done, the skills needed for jobs, and how to reward employees. The company addresses executive compensation and broad-based rewards. The company advises its clients' management and boards of directors on all aspects of executive pay programs, including base pay, annual bonuses, long-term incentives, perquisites and other benefits. The company focuses on aligning pay plans with an organization's business strategy and driving desired performance. The company's solutions incorporate proprietary market benchmarking data and software to support compensation administration.

Employee Experience - The company's Employee Experience business focuses on the provision of solutions, including employee insight and listening tools, a technology platform that connects users across its HWC segment, communication and change management services.

Revenue for the company's career-related businesses is partly seasonal in nature, with heightened activity in the second half of the calendar year during the annual compensation, benefits and survey cycles. The businesses benefit from regulatory changes affecting the company's clients that require strategic advice, program changes and communication, the redefinition of jobs, work location and career paths as technology disaggregates work, and the recalibration of pay and the employee experience amidst shifting labor markets.

Benefits Delivery & Outsourcing

The company's Benefits Delivery & Outsourcing businesses include Benefits Delivery & Administration ('BDA') and Global Outsourcing.

Benefits Delivery & Administration - The BDA business includes Individual Marketplace and Benefits Accounts.

Individual Marketplace - Individual Marketplace offers decision support processes and tools to connect consumers with insurance carriers in private individual and Medicare markets. Individual Marketplace serves both employer-based and direct-to-consumer populations through its end-to-end consumer acquisition and engagement platforms, which tightly integrate call routing technology, an efficient quoting and enrollment engine, a customer relations management system and deep links with insurance carriers. By leveraging its multiple distribution channels and diverse product portfolio, Individual Marketplace offers solutions to a broad consumer base, helping individuals compare, purchase and use health insurance products, tools and information for life.

Benefits Accounts - Benefits Accounts provides employees and retirees with tax-advantaged medical spending and savings accounts, including health savings accounts ('HSA'), health care flexible spending accounts ('HCFSA'), dependent care flexible spending accounts ('DCFSA'), limited purpose flexible spending accounts ('LPFSA') and health reimbursement arrangements ('HRA'). Benefits Accounts is an important component of the company's holistic solutions suite, allowing employers to choose among an array of funding accounts when offering employees and retirees account-based health plans.

Global Outsourcing - Global Outsourcing administers the health, welfare and retirement plans of clients using the company's proprietary technology, including tools to enable benefit modeling, decision support, enrollment and benefit choice, records management and self-service functions. Drawing on expertise in H&B and Retirement to create high-performing benefit plan designs, the company is well-positioned to help clients of all sizes simplify their benefits delivery, while lowering the total costs of benefits and related administration.

The company is the leading administrator among the 200 largest pension plans in the U.K., as well as a leader in Germany.

A significant portion of the revenue in Benefits Delivery & Outsourcing is recurring in nature, driven by either the commissions from the policies the company sells, or from long-term service contracts with its clients that typically range from three to five years. Revenue across this business is seasonal and is generally higher in the fourth quarter as it is driven when typical annual enrollment activity occurs.

Risk & Broking

The Risk & Broking ('R&B') segment provides a broad range of risk advice, insurance brokerage and consulting services to clients globally, ranging from small businesses to multinational corporations.

The segment consists of two primary businesses: Corporate Risk & Broking and Insurance Consulting and Technology businesses.

Corporate Risk & Broking ('CRB')

The CRB business places more than $30 billion of premiums into the insurance markets on an annual basis and delivers integrated global solutions tailored to client needs. This is underpinned by data and analytics through a balanced matrix of global lines of business and local Property and Casualty businesses, across three geographical areas: North America, Europe and International. Globally, and across the businesses, the company's specialized and data-driven approach is underpinned by its risk analytics and climate analytics propositions.

Across all businesses, the company's experts take an industry-focused approach to risk management and assessment, delivering broader perspectives and data-informed decision making to its clients. The company's lines of business include Property and Casualty, Affinity, Risk & Analytics and its specialty global lines of business.

Property and Casualty - Property and Casualty, in each of the company's geographical areas, provides property and liability insurance brokerage services across a wide range of industries and segments, including real estate, healthcare and retail.

Affinity - Through Affinity, the company arranges insurance products and services for its affinity client partners to offer to their customers, employees, or members alongside, or in addition to, their principal business offerings.

Risk & Analytics ('R&A') - The company's R&A offering includes deep expertise on specific client needs. Through the use of holistic analysis, R&A brings value through risk quantification and development of a robust portfolio risk strategy, ultimately delivering a sound financial approach to all clients.

The company's specialty global lines of business include:

Aerospace - Aerospace provides specialist expertise to the aerospace and space industries. The company's aerospace business provides insurance broking, risk management services, contractual and technical advisory expertise to aerospace clients globally, including the world's leading airlines, aircraft manufacturers, air cargo handlers and other airport and general aviation companies. The specialist InSpace team is also prominent in providing insurance and risk management services to the space industry.

Construction - The company's Construction business provides services that include insurance broking, claims, loss control and specialized risk advice for a wide range of construction projects and activities. Clients include contractors, project owners, public entities, project managers, consultants and financiers, among others.

Global Markets Direct & Facultative - Operating in the major wholesale reinsurance hubs across the globe, including London, Bermuda, Singapore, Hong Kong and Shanghai, solutions are delivered both directly to clients for the most complex property and casualty risks and as facultative reinsurance placements where the company serves as an intermediary for insurance companies. Facultative solutions are provided across various classes of risk for the company's insurer clients, some of which may also be direct clients of WTW. The aim is to deliver optimum results for the company's clients by getting the right risk to the right market by the right broker, be it local, wholesale or facultative every time.

Financial, Executive and Professional Risks ('FINEX') - FINEX encompasses all financial and executive risks, delivering client solutions that range from management and professional liability, employment practices liability, crime, cyber and M&A-related insurances to risk consulting and advisory services. Specialist teams provide risk consulting and risk transfer solutions to a broad spectrum of clients across a multitude of industries, as well as the financial and professional service sectors.

Financial Solutions - Financial Solutions provides insurance broking services and specialized risk advice related to credit and political risk and crisis management, including terrorism, kidnap and ransom and contingency risk. Clients include international banks, leasing companies, commodity traders, export credit agencies and multinational corporations.

Crisis Management - The company's global practice delivers crisis management and contingency risk management to multinational clients, providing comprehensive solutions around terrorism, political violence, accident and health, special crime and active assailant.

Surety - The Global Surety team provides expertise in placing bonds across all industries and around the globe. A surety bond is a financial instrument that guarantees contractual performance, statutory compliance, and financial assurance for domestic and international companies.

Marine - Marine provides specialist expertise to the maritime and logistics industries. The company's Marine business provides insurance broking services related to hull and machinery, cargo, protection and indemnity, fine art and general marine liabilities, among others. The company's Marine clients include, but are not limited to, ship owners and operators, shipbuilders, logistics operations, port authorities, traders, shippers, exhibitors and secure transport companies.

Natural Resources - The company's Natural Resources practice encompasses the oil, gas and chemicals, mining and metals, power and utilities and renewable energy sectors. It provides sector-specific risk transfer solutions and insights, which include insurance broking, risk engineering, contractual reviews, wording analysis and claims management.

Insurance Consulting and Technology ('ICT')

ICT is a global business that provides advice and technology solutions to the insurance industry. The company leverages its industry experience, strategic perspective and analytical skills to help clients measure and manage risk and capital, improve business performance and create a sustainable competitive advantage. The company's services include software and technology, risk and capital management, products and product pricing, financial and regulatory reporting, financial and capital modeling, M&A, outsourcing and business management.

Competition

The company competes with companies, such as Aon plc, Arthur J. Gallagher & Co., Brown & Brown Inc., Cognizant Technology Solutions Corporation, Marsh & McLennan Companies, Inc. ('Marsh & McLennan') and Robert Half International Inc., as well as with numerous specialty, regional and local firms.

The company's largest competitors in the pension consulting industry are Mercer HR Consulting (a Marsh & McLennan company) and Aon plc. The company's major competitors in the insurance consulting and software industry include Milliman, Oliver Wyman (a Marsh & McLennan company), the big four accounting firms (Deloitte LLP, Ernst & Young, PricewaterhouseCoopers, and KPMG), and SunGard. Aon plc, Buck Consultants (an HIG Capital Company), Connextions (a United Healthcare company), Mercer (a Marsh & McLennan company), Automatic Data Processing and Fidelity are among its largest competitors in the insurance exchange industry. With the implementation of the Patient Protection and Affordable Care Act, the company also competes with the public exchanges run by the U.S. federal, and state governments. The company also competes with providers of account-based health plans and consumer-directed benefits, such as WageWorks and HealthEquity.

Regulation

The company is subject to data privacy regulations that apply to health, medical, financial and other types of personal information belonging to its employees, clients and their employees and other third parties across most jurisdictions, including among others, the E.U. and U.K. General Data Protection Regulations, the Personal Information Protection Law (PIPL) in China and privacy legislation in certain U.S. states, including the California Privacy Rights Act (CPRA).

Some of the company's private exchange activities, including its TRANZACT business which focuses on direct-to-consumer Medicare policy sales, are overseen by the Centers for Medicare & Medicaid Services ('CMS'), which is part of the U.S. Department of Health and Human Services. Furthermore, certain of the company's activities are subject to regulation under the Health Insurance Portability and Accountability Act (HIPAA), which is enforced by the Office for Civil Rights within the Department of Health and Human Services. As it implements and expands its direct-to-consumer sales and marketing solutions through its Benefits Delivery & Administration business, the company is subject to various federal and state laws and regulations that prescribe when and how it may market to consumers (including, without limitation, the Telephone Consumer Protection Act and other telemarketing laws and the Medicare Communications and Marketing Guidelines issued by the Center for Medicare Services).

At the federal level, certain of the company's operating subsidiaries are regulated by the SEC through the Investment Company Act of 1940 and the Investment Advisers' Act of 1940 and by the Department of Labor through the Employee Retirement Income Security Act, or ERISA. In connection with the SEC regulations, it is required to file certain reports, and are subject to various marketing restrictions, among other requirements. In connection with ERISA regulations, the company is limited in the actions it can take for plans for which it serves as fiduciaries, among other matters. The company's the U.S. investment activities are also subject to certain state regulatory schemes, and some activities also are subject to regulation by the Commodities and Futures Trading Commission under the Commodities Exchange Act. In addition, the FCA extended the Senior Managers and Certification Regime ('SMCR') which became effective on December 9, 2019, in relation to the company's the U.K. FCA-regulated businesses.

The company's activities in connection with Third Party Administrator ('TPA') services in the United States are also subject to regulation and supervision by many state authorities. In the U.K., the company's business is regulated by the Financial Conduct Authority ('FCA'). The FCA has a wide range of rule-making, investigatory and enforcement powers (including the power to censure and fine) and conducts monitoring visits to assess the company's compliance with regulatory requirements.

Certain of the company's entities that undertake pension scheme management are subject to MiFID (Markets in Financial Instruments Directive) and MiFIR (the Markets in Financial Instruments Regulation). In addition, revisions to MiFID ('MiFID II') took effect in January 2018. These revisions are aimed at strengthening investor protection and improving the function of financial markets. MiFID II imposes a variety of requirements that include, among others, rules relating to product governance and independent investment advice, responsibility of management bodies, inducements, information and reporting to clients, cross-selling, remuneration of staff, and best execution of trades for clients. Further, some of the company's entities are also authorized and regulated by certain financial services authorities in countries, such as Sweden, Ireland, the Netherlands and the U.K.

History

The company was founded in 1828. The company was incorporated in 2009. It was formerly known as Willis Group Holdings Public Limited Company and changed its name to Willis Towers Watson Public Limited Company in 2016.